What would it take for the ECB to cut rates again? Deutsche Bank weighs in. in World Economy News 05/02/2026 The European Central Bank is tipped to leave interest rates on hold on Thursday, and throughout this year, as policymakers take note of tamed inflation in the Eurozone currency area. Late last year, the ECB left its key policy rate steady at 2% and upgraded its growth expectations, which investors have broadly interpreted as a sign officials may be in no rush to adjust rates. The ECB slashed rates repeatedly in 2025, bringing borrowing costs down from 3% in December 2024. ECB President Christine Lagarde and her colleagues have long been arguing that the central bank’s monetary policy is now in a “good place,” citing inflation anchored at its 2% target level. Still, some sources of uncertainty have lingered in the outlook, particularly questions around the trajectory of sweeping U.S. tariffs which have threatened to upend global trade. Writing in a note to clients on Wednesday, economists at Deutsche Bank including Mark Wall and Peter Sidorov said that while rates should stay put in 2026, risks have continued to skew to “further easing given the expected undershoot of the inflation target.” Recent events, such as the appreciation of the euro against a weakening U.S. dollar, have underlined this risk, although the case for more rate reductions “has not been proven yet,” the analysts said. They added that three scenarios could persuade the ECB to resume cuts this year: continued euro strengthening, weaker Eurozone growth, and slowing inflation. But the bar for a policy action in response to such occurrences has been lowered due to recent events, including geopolitical tensions over Greenland and worries over imported disinflation from China. “What happens next depends on the contest between external vulnerabilities and domestic resilience,” the analysts said. “Our baseline assumes the latter dominates and the ECB stays on hold. But it’s fair to say that uncertainty around the path of monetary policy has increased.” Source: Investing.com 2026-02-05 hellenicshippingnews... window.___gcfg = {lang: 'en-US'}; (function(w, d, s) { function go(){ var js, fjs = d.getElementsByTagName(s)[0], load = function(url, id) { if (d.getElementById(id)) {return;} js = d.createElement(s); js.src = url; js.id = id; fjs.parentNode.insertBefore(js, fjs); }; load('//connect.facebook.net/en/all.js#xfbml=1', 'fbjssdk'); load('https://apis.google.com/js/plusone.js', 'gplus1js'); load('//platform.twitter.com/widgets.js', 'tweetjs'); } if (w.addEventListener) { w.addEventListener("load", go, false); } else if (w.attachEvent) { w.attachEvent("onload",go); } }(window, document, 'script')); tweet Share